All Forum Posts by: Joe Arida

@Anthony Wick @Nathan Gesner

I'm planning to just state in an addendum that they are both liable for the deposit as suggested above, but also state that the deposit was received from X tenant but once Y tenant moves in they will both be jointly and severally liable for the deposit. 

I then would just verbally tell then that they will need to work out between the two of them how they want this to work. If the new tenant wants to give the original tenant a few hundred bucks so it is "equal" then they can do that--I am indifferent. Or should I put that in writing? I would rather exclude their interpersonal stuff from my legal documents--they can figure it out, right?

@Nathan Gesner that makes sense now. I just wasn't sure if it was any different for my specific scenario. I will go ahead and add those things to my lease and have my lawyer review. I really appreciate your help sir!

@Dan Moore I wouldn't say so. She takes very good care of the place. Obviously there are things here and there that will need to be replaced but there are very few things above normal wear and tear. Honestly the longer your tenant is there the harder it is to collect the deposit because there's so much more time for wear and tear to occur. I would only charge her for things that are broken, there's a few that come to mind that could add up to a few hundred dollars. Unfortunately though, most of the stuff is just normal turnover.

@Nathan Gesner thank you for that info! I will definitely get one of those to add to the lease. As far as details, this is being done as part of the renewal of the lease. So it would only be added once the new lease is written for 2019-2020. My only concern was/is the security deposit and if that matters at all. I'm thinking of writing a slightly modified amendment that just states again that the new tenant is moving in and they shall be jointly and severally liable and to add a line about the security deposit where they can choose. 

My concern more lies around the possibility that, if the original tenant moved out and the new tenant stayed, how would the security deposit be handled then? It doesn't seem right to not return it in that case?

Hi all,

My tenants is looking to have a roommate move in with her. I am having the new roommate go through the usual application process (background/credit checks, application form). My question revolves around the security deposit:

• When I purchased the place, my tenants security deposit was credited to me towards the purchase price.
• Since my current tenant paid the full security deposit ~10 years ago, how do I handle the new roommate moving in?
  • Can I write an addendum that ensures the original security deposit applies to both of them and have them both sign it?
    • Or maybe this is overkill?
  • Should I talk with my current tenant and see if she wants me to give her half of the original deposit back to her, then collect the other half from the new roommate?

Or maybe it is fine to just leave it the way it is, I just want to make sure I'm doing everything correctly here...

Thank you!

Hi BP fam!

I am setting up a Self Directed IRA and am just getting the operating agreement taken care of. I've been advised that the following setup is OK:

• I have two SDIRA accounts, one Roth and one Traditional. Both rolled over from respective 401k accounts.
• Both of these two accounts will be members in a single LLC, with each ownership percentages reflective to their contributions.
• I am then the manager of said account, with checkbook control and can invest how I see fit.
• The operating agreement already states the necessary clauses about UBTI and UDFI.

The problem is that when I told the person writing my operating agreement that there would be two members she was very skeptical that this is OK. This has happened when talking to a couple different places and explaining my setup. My adviser has reassured me that it's fine but the skepticism has me a little freaked out. Also I everything I read mentions a single-member LLC and this would then not be one of those. It's not too late to change the setup yet as I haven't funded the bank account yet.

Can some other SD IRA expert help me here? Is this OK or are there reasons I should not do it? Or is it totally not OK and my adviser is incorrect?

Thank you very much in advance!

Joe

@Steve Emling generally I make my tenants send me rent in the form of half cash half check via messenger bird. I'm not picky about the type of bird, could be pidgeon, owl, hawk... Really though I just have them write me a check and I mobile deposit it. A past tenant did bank transfers directly to my account because we had the same bank. I liked that better than the checks and may ask my current tenant to do that. I have heard mostly good things about online systems like Cozy. But I have also heard some horror stories where the tenant called Cozy and said it wasn't authorized and Cozy took the money back direct out of the LLs account, and the LL never got paid. It makes me wary of such systems.

@Christopher Lane 

If I was making $160k tax free, and my wife $100k on top of that, I would look into buying some solid B/B+ class rentals with property management that cash flow, leveraging very little. On top of that, buy some mortgage notes, targeting a 10-15% ROI--very passive. So you have a couple rentals, a few notes, which could be a nicely diversified and passive portfolio.

As far as how to handle talking about it, I think it'd probably be best to talk about it in person. It sounds like (since you're stationed overseas) you've only really talked about this over the phone or video chat? Have an in-person, respectful conversation about it. Not trying to explain it all to her until she reluctantly agrees, but just hearing her out, her hearing you out, and talking about the pros and cons. Write them down. Talking about pros and cons is great, but until things are actually written down, it's very hard for anyone to actually make a decision or feel like they've gotten anywhere. Brainstorm with her, it's a collaborative thing. If she's open to it then point her to listen to a couple episodes of the BP podcast, or an audiobook. 

I smell BS! This tenant seems to have no idea what she's talking about. A service dog has been trained since it was a puppy to be a working dog. These dogs are immaculately trained and certified to handle nearly all situations and obey commands religiously. Put bulls are almost never service dogs. There are different dog breeds that are preferred for different issues. Therapy, physical assistance, and diabetes dogs are generally Labradors. A service dog is much, much different than an emotional support animal.

Tenantresourcecenter: "Landlords can only deny the service animal or emotional support animal if:

• the tenant is not disabled or does not have a disability-related need
• the tenant fails to provide requested documentation allowed by this law
• there is undue financial or administrative burden or would fundamentally change the services provided
• the specific animal “poses a direct threat to a person's health or safety” that cannot be reduced or eliminated by another accommodation
• the specific animal would cause substantial physical damage to the property that can’t be reduced or eliminated by another accommodation. Wis. Stat. 106.50(2r)(bg)4.d., Wis. Stat. 106.50(2r), 2017 Wis. Act 317, Sec. 30"

Wis Stat: 2. "If an individual keeps or is seeking to keep an animal that is individually trained to do work or perform tasks in housing, an owner, lessor, lessor's agent, owner's agent, or representative of a condominium association may request that the individual submit to the owner, lessor, agent, or representative reliable documentation that the individual has a disability and reliable documentation of the disability-related need for the animal, unless the disability is readily apparent or known. If the disability is readily apparent or known but the disability-related need for the animal is not, the individual may be requested to submit reliable documentation of the disability-related need for the animal."

Obviously those are Wisconsin laws, check your Arkansas statutes before taking any action. If you deny for any of those reasons be prepared to back up your case in court. 

On a side note: get rid of the pet deposit and charge $40 or $50 per month in pet rent for dogs. It doesn't get returned when they leave, and that will go a lot further than a measly $50 deposit. $50 won't even barely cover a scratched up door from an excited dog as it's parent gets home.

This is pure insanity. I am really glad your husband is okay!

If your tenant isn't responding at all then the only way forward is at the minimum to evict. There's really no other option. Their dog attacked and could've killed your husband and they have the nerve to ignore you afterwards? What a BS situation! Talk to your lawyer and get the eviction started ASAP. Also, I am a dog lover and always have and always will have dogs--anyone who raises a dog that would do something like that unprovoked I would NOT want as a tenant!

I would also definitely sue for medical bills, any lost wages, and put pain and suffering on the table for negotiation. You can always settle for less if you want to.

Both of you should stay away from the house,  and ensure the incident is reported to the police. Get photos of the wounds as son as you possibly can and write a detailed account of what happened.

All the best, I hope your husband's injuries heal quickly...

Originally posted by @Bryan Wegman:

@Joe Arida Thanks Joe! I ended up getting a 30 yr fixed at 5.4% with no points. I think that will work out nicely.

 I think so too!! :) ;)